Asia Insights

Constitutional Reforms Position Kazakhstan as Increasingly Attractive Destination for Investment

Following the country’s implementation of various reforms, many Western business leaders are now viewing Kazakhstan as an increasingly attractive investment opportunity.

This growing positive sentiment forms the underlying narrative of the latest YouGov survey, which reflected recent investments made by international funds and businesses into the country.

The survey makes clear the connection between this changing attitude and the recent constitutional reforms made by Kassym-Jomart Tokayev, the President of Kazakhstan.

Reflecting on the reforms, 69 per cent of business leaders in the US and Europe recognise their positive impact.

Additionally, the YouGov survey highlights how 77 per cent believe the reforms would particularly have a positive impact on democracy.

What’s more, British and German business leaders were found to hold a more positive view of the benefits of the reform programme than their US counterparts.

This is important because Europe remain one of Kazakhstan’s biggest trading partners. Around 4,000 companies with European connections currently operating in the country.

UK and global businesses, including satellite company OneWeb – in which the UK government has a stake – and US technology group Honeywell, are the latest companies to start operations there.

Other findings from the survey indicate that 82 per cent believe the country’s President is actively prioritising the appropriate issues for reform; including human rights.

Sixty-four per cent believe he is ‘very’ or ‘quite’ serious about this. That belief was strongest among US business leaders, where 72 per cent perceive the Kazakh president’s focus on human rights.

So what do the reforms include to deserve such regard among the international community?

A new Kazakhstan

The constitutional reforms, which were overwhelmingly approved by 77 per cent of the electorate in a national referendum in June, are just the beginning of a long-term trend to usher in a ‘New Kazakhstan’, according to President Tokayev.

The reforms seek to strengthen the country’s parliament while reining in presidential powers to remove ‘oligarchic capitalism’, root out corruption and enhance the lives of Kazakhstan’s 19.4 million citizens.

Since his election in 2019, President Tokayev has introduced measures to empower women, launched compulsory health insurance and boosted child benefit payments as he seeks to reduce inequality.

His latest reforms include a pledge to protect human rights, restore a constitutional court and abolish the death penalty.

Kazakhstan is the largest and wealthiest of the five Central Asian Soviet republics that gained independence.

It is roughly the size of Western Europe and is rich in 72 natural resources, with the biggest oil reserves of any former Soviet Union country, apart from Russia, and is currently benefiting from rising oil prices.

Two-thirds of business leaders surveyed by YouGov believe Kazakhstan’s energy supplies could play an important role in solving the global energy crisis.

The YouGov survey is the latest study to highlight the growing appeal of Kazakhstan to foreign investors and businesses.

Foreign trade and resources

In the first five months of this year, Kazakhstan’s foreign trade hit $51billion; a year-on-year growth of 41 per cent. Likewise, its trade with the UK reached $8.1billion during this time, up 66 per cent in the first seven months of the year.

In more good news, foreign direct investment in Kazakhstan reached its highest level for a decade in Q2 ’22 at $7.58billion. The country’s leaders actively engage in talks with institutional investors, including Franklin Templeton, Goldman Sachs and Citi, to discuss potential investment opportunities.

The London Stock Exchange is also promoting Kazakhstan’s economic prospects, as the country embarks on a major privatisation programme and several key businesses, including Air Astana, in which Bae Systems holds a 49 per cent stake, prepare to float.

The exchange recently hosted its fifth annual Kazakhstan Global Investment Forum in partnership with Kazakhstan’s sovereign wealth fund Samruk-Kazyna.

A separate EY report, published this month, highlights the President’s key priorities, which include raising economic growth and inclusion by promoting economic diversification, developing the private sector, reducing corruption and improving governance.

Likewise, a recent report from the Chamber of International Commerce of Kazakhstan quotes several independent investors highlighting the country’s potential.

Marius Dan, deputy CEO, corporate strategy, Franklin Templeton
Marius Dan, deputy CEO, corporate strategy, Franklin Templeton

“An exciting investment opportunity considering Kazakhstan’s economic stability, abundant natural resources, strong commodity market fundamentals and the political and economic reforms by President Tokayev,” Marius Dan of Franklin Templeton said in the report

Roland Nash of VPE Capital, adds: “It is a country with enormous potential driven by international trade. Its unique geographical position makes it extremely well placed to take full advantage of the rise of China/Asian trade but also the rapidly growing European demand for the vital commodities Kazakhstan produces.”


  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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